Options (or Derivatives in general) are instruments whose payoffs depend on the movement of underlying assets. The value of the derivative instrument, therefore, can be evaluated by creating and valuing a portfolio of assets whose prices are easily observed in the market and whose cash flows replicate those of the options.

The methodologies used to price a derivative security may vary from closed form solutions such as the Black-Scholes option pricing formula, to numerical methods such as the binomial trees and Monte Carlo simulation.

Our Option pricing guides cover vanilla options, exotics, interest rate derivatives & cross currency swaps. We use Monte Carlo Simulation for exotics, Black Scholes for intuition, Binomial trees for American options & forward and zero curves for interest rate derivatives

- How to calculate the value of a forward contract in Excel
- How to calculate the forward price of a security in Excel
- How to determine Spot Rates and Forward Rates & Yield to Maturity
- How to calculate the values of Forward Rate Agreements (FRA) and Forward Exchange Rates
- Simulation Models – Pricing Ladder Options using Monte Carlo Simulations
- Pricing Exotic Options using Monte Carlo Simulations
- Understanding delta hedging for options

- Derivative Products
- Derivatives Crash Course for Dummies
- Advanced Derivatives Crash Course – Structured products, credit derivatives, exotics
- Derivative Pricing, Risk Management, Financial Engineering – Equation Reference
- Options pricing with Binomial trees in Excel spreadsheets
- Pricing Interest Rate Swaps – The valuation and MTM course
- Interest Rate Options – Pricing Caps and Floors
- Computational Finance: Building Monte Carlo (MC) Simulators in Excel
- Monte Carlo Simulation – How to reference
- Convergence and Variance Reduction procedures for option pricing models
- War on Greeks. The weekend Option pricing challenge
- Selling derivative products to treasury customers
- The Option Pricing models 5 nights crash course
- Option Pricing course guide for dummies

# Recent Posts

- Hedge effectiveness of vanilla options, TARF & participating forwards
- Volatility surface, deep out of the money options and lottery tickets
- Building implied and local volatility surfaces in Excel tutorial – coming soon
- Risk Models, Option pricing & Bank Regulation training – 2013 guide
- War on Option Greeks – The weekend option pricing risk challenge
- The Option Pricing models 5 nights crash course
- Option Greeks – Theta time premiums for call options
- Option Greeks – Delta, Gamma, Vega, Theta & Rho.
- Simulation tools. Variance reduction techniques for option pricing models
- Difference between N(d1) and N(d2)

# Premium Courses:

**PDF & EXCEL**

**Online**

- Derivatives Terminology Crash Course
- Derivatives Pricing – Package
- Derivative Products
- Derivative Products – Package
- Derivative Pricing – Binomial Trees EXCEL Example
- Derivative Pricing – Binomial Trees – Efficient Approach – Print Edition
- Forward Prices, Forward Rates and Forward Rate Agreements (FRA) – EXCEL Example
- Forward Prices, Spot Rates & Forward Rates, Yield-to-Maturity, Forward Rate Agreements (FRA), Forward Contracts and Forward Exchange Rates – PDF
- Forward Prices and Forward Rates – Calculation reference & detailed examples
- Monte Carlo Simulation – Commodity – Example
- Monte Carlo Simulation – Currency – Example
- Monte Carlo Simulation – Equity – Example
- Monte Carlo Simulation – Package
- Monte Carlo Simulator with Historical Returns
- Pricing IRS – Module I – Term Structures
- Pricing IRS – Module I – Term Structures EXCEL Example
- Pricing IRS – Module II – IRS and CCS
- Pricing IRS – Module II – IRS and CCS EXCEL Example
- Pricing Interest Rate Options – Module III
- Pricing Interest Rate Options – Module III EXCEL Example
- Pricing Ladder Options using a Monte Carlo Simulator
- Pricing Interest Rate Swaps and Interest Rate Options – Package
- Valuing Options – Black Scholes Example
- Valuing Options – Binomial Tree – Traditional Approach – EXCEL Example